Home loan application is approved – what next?

 Once you’ve found your ideal property, made an offer and gotten your home loan application approved by the bank, the most crucial step to follow is registering and moving into your dream house.

Dr Simphiwe Madikizela, Head of Special Projects at FNB Housing Finance, says “On average the property registration process takes about three months or more to complete, which can often be frustrating for first time buyers. Therefore, being informed will help you meet most of the requirements upfront, making the registration process and experience as seamless as possible.” 

He explains what buyers should expect during the registration process: 

Home Loan quote – the bank will send you a quotation which you should read and understand. Once you are satisfied with the agreement, sign the documents and send them back as soon as possible.

Life Insurance – you may be required to have adequate life insurance or a mortgage protection plan that will be ceded onto the home loan to cover the outstanding amount in the unfortunate event that you pass away. This ensures that your home loan balance is paid off, to prevent your loved ones from facing financial difficulties. 

Attorney’s fees – in order for the registration process to proceed, the bank and the seller appoint bond registration and transferring attorneys, respectively. Each of these attorneys will charge fees which need to be paid by the buyer upfront. For example, bond registration on a R700 000 home loan approximately costs R22 000 while transfer fees will amount to R16 000. 

Signing of documents – bond registration and transferring attorneys will invite you to their offices to sign a couple of documents. You will be required to provide your original ID document, proof of residence, income tax number on a SARS letterhead and proof of your banking details.

Moving arrangements – you shouldn’t wait until the property is registered to make moving arrangements. Not only is a move costly if unplanned for, but you will also have to start paying your home loan instalment on the first month after registration. Also take into account your current lease agreement if you are renting, as you may have to pay a cancellation fee and give the property owner 30 days notice.

“It is advisable to cooperate with all parties involved in the registration of the bond to avoid unnecessary delays. If there’s anything you don’t understand speak to your Home Loans consultant for clarity” concludes Madikizela.

FNB has developed a tool, nav>> Home to assist prospective home owners to find their dream home, get preapproved in minutes and acquire knowledge about the home buying and registration process.